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Division of Motor Vehicles Denies New Dealership License For Tesla

Automotive News reported earlier this week that the North Carolina Division of Motor Vehicles denied a Tesla Motors application to open a dealership in Matthews.

The ruling is the latest in a long series of battles Tesla has waged with dealership groups and state lawmakers on the legality of its direct-sales model. Tesla owns and operates its own dealerships, which the automaker says allows it to more effectively retail its vehicles. Opponents of the direct-sales model have said it hurts consumers.

The electric automaker argued this month that the Matthews location should be exempt from the state’s ban on manufacturer-owned dealerships, according to a DMV order. The state instead sided with four dealership groups in opposing issuing the license. Hendrick Automotive Group and Sonic Automotive Inc. were two of the opponents.

Administrative hearing officer Larry Greene refused to provide the exemption, however, saying that there are "at least three independent dealers" who could operate a Tesla dealership in "a matter consistent with the public interest."

The Matthews dealership would have been the company's second in North Carolina; its first is on Westgate Park Dr. in Raleigh.